PUBLIC RECORD OFFICE
Reference :-
BEC.O. 882
8 PUBLIC RECORD OFFICE, LONDON
ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH-NOT TO
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to make it worth 1s. 6d. This reasoning, is on the basis of the rate of compensation alone, and requires to be qualified by including in the calculation the comparative additions made from time to time to the number of rupees or dollars upon which the compensation is granted, but you will appreciate that the obvious inference from the argument that double exchange compensation was much more valuable to officers in the Malay Peninsula and Hongkong than it would be to officers in Ceylon, is, that the latter were already proportionately better off as far as the exchange value of silver is concerned : and it is, I think, correct to say that until quite recently the question of exchange has been the dominating consideration in any revision of salaries in the Eastern colonies.
12. In the fourth paragraph of my despatch of the 5th of February last I wrote "no tendency has at present manifested itself on the part of successful candidates for "Eastern cadetships to cease to give preference to Ceylon. Living in Ceylon is, I am advised, still distinctly cheaper than in the Malay Peninsula or Hong Kong, and when "the greater variety of climates in Ceylon and the shorter distance of the colony from "home are also taken into consideration, I do not think that any necessity could be shown "for raising the standard of Ceylon salaries to the level in sterling of those in the Straits "Settlements and the Federated Malay States." I am now informed that living is fully as expensive in Ceylon as farther east, that the death rate for Europeans is higher in Ceylon than in Hong Kong and the Straits Settlements, that few Government officers have stations in the hills in Ceylon and those who have not have no time or money to go there for change, and that the fact of Ceylon being nearer home makes practically little or no difference in cost of passage, seeing that the visits home are so rare. In short, Ceylon appears to have so many and such great disadvantages that it is rather difficult to account for the misunderstanding under which it has been for many years regarded by Government officers as the most desirable of all the Crown Colonies. The committee, I may note in passing, though the point is immaterial, are not quite correct in their information as to vacation leave in Hong Kong. The four months' vacation leave has been reduced to three since 1st March, 1894, in the case of all officers who joined after
that date.
13. These statements, or some of them, are endorsed by you in the light of your recent experience of Hong Kong and therefore it is difficult for me to refuse to accept them; yet I must confess that they seem to me to be open to criticism. I will take the question of cost of living. The committee, leaving out the Malay States, compare the cost of living at Colombo with that at Hong Kong and Singapore and you state that your own experience is that Ceylon is quite as expensive to live in as Hong Kong. Hong Kong and the Straits Settlements are very largely town colonies-certainly to a much greater extent than Ceylon; but, while the committee give prices at Colombo, compare them with prices at Hong Kong and Singapore, and show how they have risen between 1894 and 1904, in another part of their report they recommend special station allowances for Colombo as opposed to the rest of Ceylon, and explain that officers in Colombo pay 16 per cent. of their salaries in rent while officers at out-stations are given Government quarters for which they only pay six per cent. In other words they take prices at Colombo in order to prove that conditions in Ceylon are “ practically identical with those in the other Eastern colonies, and they proceed to prove that the conditions of Colombo are widely different from those of the rest of Ceylon. I am not aware whether conditions have changed much in the last four years, but I have before me a memorial from the cadet service of the Straits Settlements which was sent home by the then Acting Governor in August, 1900, and in which the petitioners pointed out "that the cost of living is much less in Ceylon than it is in the Straits, house rent, servants' wages, and the cost of provisions being much lower there." The petitioners added that the purchasing power of the dollar in the Straits Settlements was not much greater than that of the rupee in Ceylon, and I question whether the committee by simply converting dollars into rupees correctly represent the facts of the case as regards the respective purchasing power of the two coins. However, I will assume the accuracy of the state- ment, novel as it is to me, that there are "practically identical conditions in Ceylon and the other Eastern colonies," and, after considering the incidental though very important points which have been raised, will proceed to consider what the committee call "the unreasonable inequality between salaries in Ceylon and the other Eastern colonies."
14. The first question with which I will deal, apart from the main subject of rates of salary, is that of the age of retirement and of the maximum pension. The committee criticise the suggestion made in my despatch of 5th February that the Ceylon pension
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minute should be amended "so as to provide that no person who joins the Ceylon service hereafter should be allowed to earn a larger pension than £1,000 or Rs. 15,000
at 18. 4d.
This rule, as I stated in my despatch, has been adopted in Hong Kong and the Straits Settlements and the sum is that which the Imperial Acts award as a maximum to the holders of first class governments. The committee give figures which, to quote their words, "full so far short of the £1,000 which the Secretary of State lays down as the maximum that we can only conjecture that the facts of the case are imperfectly appreciated at home."
If the contingency of a Ceylon Government servant obtaining a pension exceeding £1,000 per annum, which, with the higher rates of exchange for the rupée, has frequently occurred in the past, is certain not to arise in the future, at worst the rule will only be a dead letter; but the committee's calculations are based on salaries alone, leaving out the possibility of other emoluments being treated as pensionable; and, though the rule is intended for the whole Government service, they, for some reason, which I do not understand, leave out of their calculations the salaries of the Lieutenant-Governor and Chief Justice as being on a special footing,
However, this is a small matter, and the important point is the two-fold recom- mendation of the committee, which you consider to be eminently reasonable, that the age of voluntary retirement should be 50 and not 55, and that a maximum pension should be allowed after 30 instead of after 35 years. I regret that I cannot accept these sugges- tions for the following reasons. Whatever decision is taken for Ceylon on these points must be applied at any rate to the other Eastern colonies, and probably to tropical Crown colonies in general. Now, in the Malay Peninsula, the question of reducing the age of optional retirement from 55 to 50 has comparatively recently been raised and decided. The Straits Settlements petition, to which I have already referred, included a request that the age of optional retirement might be reduced from 55 to 30; but the application was not recommended by the then Acting Governor, and after full consideration, Mr. Chamberlain saw no sufficient reason to grant the concession. It is obvious that acceptance of the two recommendations of the committee would-to say the least-prevent a reduction in the non-effective charges on the Ceylon Exchequer; I cannot admit that the pension rules, as they stand, are otherwise than liberal; and it may be taken as some indication of feeling on the subject in other parts of the tropics that in more than one of the West Indian colonies, proposals made at the instance of the Secretary of State to reduce the age of optional retirement from 60 to 55 have been rejected by the local legislatures.
15. The committee "enter a respectful but earnest protest against the proposal of the Secretary of State that in the case of officers appointed after February 19th, 1897, the rate of payment of Widows' and Orphans' pensions should be reduced from 18. 6d. to 18. 4. the rupee. Such a ruling would but still further accentuate the inequality to which we have just alluded, and we submit that in any case it would not be equitable to apply it to officers already in the service."
My object has been and is to gradually abolish fictitious rates of payment, so far as this can be done without hardship to those already in the service. Every year the Ceylon Estimates contain an item, at present small but constantly growing, for "Loss on exchange on Widows' and Orphans' pensions payable in England at 18. 6d. the rupee." The charge has been duly sanctioned, but it is not one which ought rightfully to fall upon the general community. I therefore proposed that, while adding to the number of rupees upon which certain officers would contribute to the Widows' and Orphans' pension fund and thereby proportionately increasing the widows' pensions, those pensions should no longer be paid at a fictitious rate. The widows-it was intended-should receive as much as before, being given more rupees but at a lower rate; while the officers, though paying larger contributions to the fund, would, through the increase to their salaries, be in no way losers. I fail to see the unfairness of the proposal; and the protest is in effect, a protest not against the reduction of the widows' pensions but against their not being increased.
16. I take next the question of fees. The committee's recommendations, which do not seem to cover all the appointments to which fees are attached, practically amount to leaving the matter very much as it is at present. It is suggested that, in the case of the